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Alvarez vs. PICOP Resources Inc.
Alvarez vs. PICOP Resources Inc.
DECISION
CHICO-NAZARIO , J : p
On the line are three consolidated Petitions, all arising from the 11 October 2002
Quezon City Regional Trial Court (RTC) Decision 1 granting the Petition for Mandamus
led by Paper Industries Corporation of the Philippines (PICOP). The Court of Appeals
a rmed the 11 October 2002 RTC Decision, with modi cation, in a 19 February 2004
Decision. 2
In G.R. No. 162243, then Department of Environment and Natural Resources
(DENR) Secretary Heherson T. Alvarez, who was later successively substituted by
subsequent DENR Secretaries Elisea G. Gozun and Angelo T. Reyes, assails the 19
February 2004 Decision insofar as it granted the Petition for Mandamus. In G.R. No.
164516, PICOP assails the same Decision insofar as it deleted the imposition of
damages against then Secretary Alvarez. Secretary Reyes filed a third Petition docketed
as G.R. No. 171875, assailing the 16 December 2004 Amended Decision 3 of the Court
of Appeals lifting the Writ of Preliminary Injunction that enjoined the enforcement of the
11 October 2002 Decision and 10 February 2003 Orders of the RTC.
FACTS
The facts, culled from the records of the three consolidated petitions, are as
follows:
On 24 May 1952, PICOP's predecessor, Bislig Bay Lumber Co., Inc. (BBLCI) was
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granted Timber License Agreement (TLA) No. 43. 4 The TLA was amended on 26 April
1953 and 4 March 1959. As amended, TLA No. 43 covers an area of 75,545 hectares in
Surigao del Sur, Agusan del Sur, Compostela Valley, and Davao Oriental.
Allegedly sometime in 1969, the late President Ferdinand E. Marcos issued a
presidential warranty to BBLCI, con rming that TLA No. 43 "de nitely establishes the
boundary lines of [BBLCI's] concession area." 5
TLA No. 43, as amended, expired on 26 April 1977. It was renewed on 7 October
1977 for another 25 years to "terminate on April 25, 2002." 6
On 23 December 1999, then DENR Secretary Antonio H. Cerilles promulgated
DENR Administrative Order (DAO) No. 99-53 which had for its subject, the "Regulations
Governing the Integrated Forest Management Program (IFMP)." 7
In a 28 August 2000 letter to the Community Environment and Natural Resources
O ce (CENRO), DENR-Region XIII-D4, Bislig, Surigao del Sur, PICOP signi ed its
intention to convert its TLA No. 43 into an Integrated Forest Management Agreement
(IFMA) invoking the provisions of Section 9, Chapter III of DAO No. 99-53. 8
Acting on the said letter, Forester III Tri no M. Peregrino, In-Charge, O ce of the
CENRO, wrote a letter dated 1 September 2000 to PICOP's resident manager in Tabon,
Bislig, Surigao del Sur, informing PICOP "that we will consider said letter as an advance
notice considering that it is yet premature to act on your request since we are yet in CY
2000." 9
In a 24 January 2001 letter, Neolito Frondozo, Group Manager, Forest Operations
Manager of PICOP, requested for a favorable indorsement of their letter of intent from
the CENRO of the DENR, Region XIII-D4 in Bislig City. This was followed up by another
letter dated 25 January 2001 of Wilfredo D. Fuentes, Vice President and Resident
Manager of PICOP, to the Regional Executive Director (RED), DENR, Caraga Region XIII
in Ambago, Butuan City, likewise, requesting for a favorable indorsement of their letter
of intent to the DENR Secretary. 1 0
The O cer-In-Charge (OIC), Regional Executive Director Constantino A. Paye, Jr.,
in a 6 March 2001 Memorandum, forwarded PICOP's letter of intent dated 28 August
2000 to the DENR Secretary informing the latter that the DENR Caraga Region XIII in
Ambago, Butuan City, had created a team tasked to conduct a performance evaluation
on PICOP on the said TLA pursuant to DAO No. 99-53. 1 1
Subsequently, Elias R. Seraspi, Jr., RED, DENR, Caraga Region XIII in Ambago,
Butuan City, submitted a 31 July 2001 Memorandum to the DENR Secretary on the
performance evaluation of PICOP on its TLA No. 43. Paragraph 11 of the same
Memorandum reads:
Hence, it is imperative to chart a good forest policy direction for the
management, development and protection of TLA No. 43 after it expires on April
26, 2002 for the purpose of sustainable forest management of the area in support
of national development. With this vision, the proper evaluation to consider the
request for automatic conversion of TLA No. 43 to IFMA pursuant to Section 9,
DENR A.O. No. 99-53, upon its expiration on April 26, 2002 is hereby
recommended. 1 2
Attached to said Memorandum, inter alia, were the 11 July 2001 Report and 27
July 2001 Supplemental Report of the Performance Evaluation Team created to
conduct such performance evaluation indicating violations by PICOP of existing DENR
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Rules and Regulations governing TLA No. 43, such as the non-submission of its ve-
year forest protection plan and seven-year reforestation plan as required by the DENR
rules and regulations. The said 31 July 2001 Memorandum was forwarded to the
Forest Management Bureau (FMB) for appropriate action and recommendation. 1 3
Sometime in September 2001, the DENR Secretary was furnished a copy of
Forest Management Specialist II (FMS II) Teo la L. Orlanes' 24 September 2001
Memorandum concerning alleged unpaid and overdue forest charges of respondent on
TLA No. 43. Attached thereto was a 19 September 2001 Memorandum of Amelia D.
Arayan, Bill Collector of the DENR R13-14, Bislig City, likewise indicating purported
unpaid and overdue forest charges by PICOP on its TLA No. 43. 1 4
Said Memorandum was referred to FMB Director Romeo T. Acosta, who directed
FMB Senior Forest Management Specialist (SFMS) Ignacio Evangelista to proceed to
Region 13 to gather forestry-related data and validate the report contained in the
respective Memoranda of Orlanes and Arayan. 1 5 SFMS Evangelista found that the 8
May 2001 to 7 July 2001 forest charges adverted to in the Orlanes and Arayan
Memoranda was belatedly led. He also found that PICOP had not paid its regular
forest charges covering the period of 22 September 2001 to 26 April 2002 in the total
amount of P15,056,054.05. 1 6 Moreso, he discovered that from 1996 to 30 August
2002, PICOP was late in paying some of its forest charges in 1996, and was
consistently late in paying all its forestry charges from 1997 onwards. 1 7
The overdue and unpaid forest charges (including penalties, interests and
surcharges) of PICOP total P150,169,485.02. Its silvicultural fees amount to
P2,366,901.00 from 1996 up to 30 August 2002. In all, PICOP has an outstanding and
overdue total obligation on its forest charges in the amount of P167,592,440.90 as of
30 August 2002. 1 8
Thus, FMB Director Acosta submitted a 5 October 2001 Memorandum to the
DENR Secretary concerning PICOP's application for conversion of its TLA No. 43 into an
IFMA, viz:
RECOMMENDATION
The conversion of the TLA into IFMA is primarily aimed at sustaining the
raw materials for the continuous operation of the integrated wood processing
plant of the company. However, the very complex issues presented cannot just be
ignored and have to be fully addressed to before further appropriate action is
taken on the application for conversion. In the absence of categorical comments
and recommendation of the regional o ce to resolve the issue, it is
recommended that a transition team composed of the following be created: . . . .
19
President
PICOP Resources Incorporated
2nd Flr, Moredel Building
HEHERSON T. ALVAREZ
Secretary 2 7
It was the position of the DENR members of the TWC that PICOP's application
for the IFMA conversion should undergo the process as provided in DAO No. 99-53.
PICOP representative Atty. Caingat, however, claimed that "the TLA has been converted"
and suggested the suspension of the meeting as they would submit a written position
on the matter the following day. 2 8
On 22 April 2002, the TWC members of the DENR received a letter from PICOP
dated 18 April 2002 insisting that "the conversion of TLA No. 43 into IFMA has already
been completed" and indicated that they had "no choice except to decline participation
in the ongoing meeting and bring our issues to the proper public and legal forum." 2 9
On 24 April 2002, the TWC submitted a Memorandum dated 22 April 2002 to the
Undersecretary for Operations and Undersecretary for Legal, Lands and International
Affairs of the DENR, enumerating the salient points taken up during the TWC meetings.
This includes the performance evaluation report of the DENR Regional O ce covering
the period from 24 June 1999 to 23 June 2000. The report states that PICOP has not
submitted its 5-Year Forest Protection Plan and 7-Year Reforestation Plan; that it has
unpaid and overdue forest charges; and its failure to secure a clearance from the
Regional O ce of the NCIP considering the presence of Indigenous Peoples (IPs) in
the area and Certificate of Ancestral Domain Claims issued within the area.
The DENR Secretary instructed the RED, Caraga Region, to coordinate with PICOP
and reiterate the requirements for conversion of TLA No. 43 into IFMA.
Thereafter, the FMB Director received a letter dated 6 August 2002 from NCIP
Chairperson Atty. Evelyn S. Dunuan informing him that, based on their records, no
certi cation has been issued to PICOP concerning its application for conversion of its
TLA No. 43 into IFMA, "as there has never been an application or endorsement of such
application to our office." 3 0
On 12 August 2002, a meeting was held at the O ce of the President of the
Philippines presided by Undersecretary Jose Tale and Undersecretary Jake Lagonera of
the O ce of the Executive Secretary. PICOP's representatives committed to submit the
following, to wit:
1. Certi cate of Filing of Amended Articles of Incorporation issued on 12
August 2002 that extended PICOP's corporate term for another fty (50)
years;
2. Proof of Payment of forest charges;
3. Proof of Payment of Reforestation Deposit;
b) The proof of payments for forest charges covers only the production
period from 1 July 2001 to 21 September 2001;
c) The proof of payment of reforestation deposits covers only the period from
the first quarter of CY 1999 to the second quarter of CY 2001;
d) The map of the areas planted through supplemental planting and social
forestry is not su cient compliance per Performance Evaluation Team's
11 July 2001 report on PICOP's performance on its TLA No. 43, pursuant to
Section 6.6 of DAO 79-87; and
e) PICOP failed to respond completely to all the social issues raised. 3 2
PICOP led a Motion for Partial Reconsideration 5 4 of this Decision, which was
denied by the Court of Appeals in a 20 July 2004 Resolution. 5 5
Meanwhile, in a 22 March 2004 Resolution, 5 6 the Special Thirteenth Division of
the Court of Appeals held in abeyance the ruling on the Motion for Reconsideration of
the INJUNCTION CASE pending the Seventh Division's resolution of the Motion for
Reconsideration of the 19 February 2004 Decision in the MANDAMUS CASE.
The DENR Secretary and PICOP led with this Court separate Petitions for
Review on the 19 February 2004 Court of Appeals Decision in the MANDAMUS CASE.
These Petitions were docketed as G.R. No. 162243 and 164516, respectively. EICSDT
The Writ of Preliminary Injunction dated 30 April 2003 is hereby lifted and
dissolved and the Order dated 10 February 2003 allowing execution pending
appeal and authorizing the issuance of the writ of mandamus and/or writ of
mandatory injunction is hereby a rmed. The Petition dated February 27, 2003 is
herewith dismissed. 5 8
V
WHETHER [PICOP] HAS FAITHFULLY COMPLIED WITH ALL THE
ADMINISTRATIVE AND OTHER STATUTORY REQUIREMENTS ENTITLING IT TO
AN IFMA CONVERSION.
VI
Finally, in G.R. No. 171875, the DENR Secretary submits the following arguments:
A. [PICOP] DID NOT ACTUALLY FILE A MOTION FOR EXECUTION PENDING
APPEAL.
B. THERE ARE NO GOOD REASONS FOR THE GRANT OF EXECUTION
PENDING APPEAL. 6 5
The Court of Appeals is correct. Since PICOP alleges grave abuse of discretion
on the part of the DENR Secretary, it behooves the court to determine the same. An
outright dismissal of the case would have prevented such determination.
For the same reason, the MANDAMUS CASE could not have been dismissed
outright for lack of cause of action. A motion to dismiss based on lack of cause of
action hypothetically admits the truth of the allegations in the complaint. 6 9 In ruling
upon the DENR Secretary's Motion to Dismiss, PICOP's allegation that it has a contract
with the government should, thus, be hypothetically admitted. Necessarily, the DENR
Secretary's argument that there was no such contract should be considered in the trial
of the case and should be disregarded at this stage of the proceedings.
The DENR Secretary, however, counters that he/she has not yet exercised his/her
exclusive jurisdiction over the subject matter of the case, i.e., either to approve or
disapprove PICOP's application for IFMA conversion. Hence, it is argued that PICOP's
immediate resort to the trial court was precipitate based on the doctrine of exhaustion
of administrative remedies. 7 0
The Court of Appeals ruled that the doctrine of exhaustion of administrative
remedies is disregarded when there are circumstances indicating the urgency of
judicial intervention, 7 1 which are averred to be extant in this case, citing PICOP's
employment of a sizable number of workers and its payment of millions in taxes to the
government. 7 2 The Court of Appeals appends:
Moreover, contrary to [the DENR Secretary's] claim, the approval of an
application for IFMA conversion is not purely discretionary on the part of the
DENR Secretary since the approval of an IFMA conversion depends upon
compliance with the requirements provided under DAO No. 99-53.
While the Court of Appeals is correct in making such rulings, such accuracy
applies only insofar as the RTC assessment that the MANDAMUS CASE should
not have been subjected to outright dismissal . The issue of whether there was
indeed an urgency of judicial intervention (as to warrant the issuance of a writ of
mandamus despite the exclusive jurisdiction of the DENR) is ultimately connected to
the truth of PICOP's assertions, which were hypothetically admitted in the motion to
dismiss stage. In other words, it all boils down to whether the DENR Secretary
committed grave abuse of discretion in not executing the IFMA documents and in not
approving PICOP's harvesting of timber from the area of TLA No. 43. aTHASC
The sixth issue raised by the DENR Secretary concerns Section 1 of Presidential
Decree No. 605 which, according to the Court of Appeals had been partly repealed by
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Republic Act No. 8975. Section 1 of Presidential Decree No. 605 provides:
SECTION 1. No court of the Philippines shall have jurisdiction to issue any
restraining order, preliminary injunction or preliminary mandatory injunction in
any case involving or growing out of the issuance, approval or disapproval,
revocation or suspension of, or any action whatsoever by the proper
administrative o cial or body on concessions, licenses, permits, patents, or
public grants of any kind in connection with the disposition, exploitation,
utilization, exploration and/or development of the natural resources of the
Philippines.
The DENR Secretary claims that since Republic Act No. 8975 simply declares
that Presidential Decree No. 605 or parts thereof "inconsistent with this Act are hereby
repealed or amended accordingly," then, there should be an inconsistency between
Presidential Decree No. 605 and Republic Act No. 8975 before there can be a partial
repeal of Presidential Decree No. 605.
We agree with the DENR Secretary. Republic Act No. 8975 was not intended to
set out in full all laws concerning the prohibition against temporary restraining orders,
preliminary injunctions and preliminary mandatory injunctions. Republic Act No. 8975
prohibits lower courts from issuing such orders in connection with the implementation
of government infrastructure projects, while Presidential Decree No. 605 prohibits the
issuance of the same, in any case involving licenses, concessions and the like, in
connection with the natural resources of the Philippines. This can be further seen from
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the respective titles of these two laws, which, of course, should express the subjects
thereof: 7 5
REPUBLIC ACT NO. 8975
However, when the licenses, concessions and the like also entail government
infrastructure projects, the provisions of Republic Act No. 8975 should be deemed to
apply, 7 6 and, thus, Presidential Decree No. 605 had been modified in this sense.
Nevertheless, despite the fact that Presidential Decree No. 605 subsists, the
DENR Secretary must have missed our ruling in Datiles and Co. v. Sucaldito , 7 7 wherein
we held that the prohibition in Presidential Decree No. 605 "pertains to the issuance of
injunctions or restraining orders by courts against administrative acts in
controversies involving facts or the exercise of discretion in technical cases ,
because to allow courts to judge these matters could disturb the smooth functioning
of the administrative machinery. But on issues definitely outside of this dimension
and involving questions of law , courts are not prevented by Presidential Decree No.
605 from exercising their power to restrain or prohibit administrative acts."
While there are indeed questions of facts in the present Petitions, the overriding
controversy involved herein is one of law: whether the Presidential Warranty issued by
former President Marcos are contracts within the purview of the Constitution's Non-
Impairment Clause. Accordingly, the prohibition in Presidential Decree No. 605 against
the issuance of preliminary injunction in cases involving permits for the exploitation of
natural resources does not apply in this case.
Moreover, as we held in Republic v. Nolasco , 7 8 statutes such as Presidential
Decree No. 605, Presidential Decree No. 1818 and Republic Act No. 8975 merely
proscribe the issuance of temporary restraining orders and writs of preliminary
injunction and preliminary mandatory injunction. They cannot, under pain of violating the
Constitution, deprive the courts of authority to take cognizance of the issues raised in
the principal action, as long as such action and the relief sought are within their
jurisdiction. We further held in Nolasco:
However, it must be clari ed that Republic Act No. 8975 does not ordinarily
warrant the outright dismissal of any complaint or petition before the lower courts
seeking permanent injunctive relief from the implementation of national
government infrastructure projects. What is expressly prohibited by the statute is
the issuance of the provisional reliefs of temporary restraining orders, preliminary
injunctions, and preliminary mandatory injunctions. It does not preclude the lower
courts from assuming jurisdiction over complaints or petitions that seek as
ultimate relief the nulli cation or implementation of a national government
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infrastructure project. A statute such as Republic Act No. 8975 cannot
diminish the constitutionally mandated judicial power to determine
whether or not there has been a grave abuse of discretion amounting to
lack or excess of jurisdiction on the part of any branch or
instrumentality of government . . . . . 7 9
We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs.
Deputy Executive Secretary [190 SCRA 673, 684 (1990)]:
". . . Timber licenses, permits and license agreements are the
principal instruments by which the State regulates the utilization and
disposition of forest resources to the end that public welfare is promoted.
And it can hardly be gainsaid that they merely evidence a privilege granted
by the State to quali ed entities, and do not vest in the latter a permanent
or irrevocable right to the particular concession area and the forest
products therein. They may be validly amended, modi ed, replaced or
rescinded by the Chief Executive when national interests so require. Thus,
they are not deemed contracts within the purview of the due process of law
clause [See Sections 3(ee) and 20 of Pres. Decree No. 705, as amended.
Also, Tan v. Director of Forestry , G.R. No. L-24548, October 27, 1983, 125
SCRA 302]."
Since timber licenses are not contracts, the non-impairment clause, which
reads:
cannot be invoked.
PICOP, however, argues that these rulings laid down in Tan v. Director of Forestry,
83 Felipe Ysmael, Jr. & Co., Inc. v. Deputy Executive Secretary 8 4 and Oposa do not nd
application in the present case allegedly because the issue here is the unlawful refusal
of then DENR Secretary Alvarez to issue an IFMA to PICOP and not the matter of a
timber license being merely a license or privilege. 8 5
We are not persuaded. PICOP led the MANDAMUS CASE against then DENR
Secretary Alvarez on the ground that Secretary Alvarez's refusal to issue an IFMA in its
favor allegedly violated its vested right over the area covered by its TLA No. 43 and
presidential warranty, and impaired the obligation of contract under said agreement
and warranty. 8 6
The argument that the Presidential Warranty is a contract on the ground that
there were mutual considerations taken into account consisting in investments on
PICOP's part is preposterous. All licensees put up investments in pursuing their
businesses. To construe these investments as consideration in a contract would be to
stealthily render ineffective the settled jurisprudence that "a license or a permit is not a
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contract between the sovereignty and the licensee or permittee, and is not a property in
the constitutional sense, as to which the constitutional proscription against the
impairment of contracts may extend." 8 7 Neither shall we allow a circumvention of such
doctrine by terming such permit as a "warranty."
Whether or not there was
compliance with the requirements
for the conversion of TLA No. 43
as amended into an IFMA
DAO No. 99-53 enumerates the requirements for the grant of the IFMA
conversion:
Sec. 9. Qualifications of Applicants. The applicants for IFMA shall be:
(a) A Filipino citizen of legal age; or
Section 59 of RA 8371, which requires prior certi cation from the NCIP that
the areas affected do not overlap with any ancestral domain before any IFMA can
be entered into by the government, should be read in conjunction with Sections 3
(a) and 56 of the same law.
[PICOP] has already acquired property rights over its concession areas. It
has been in exclusive, continuous and uninterrupted possession and occupation
of TLA No. 43 areas since 1952 to present. From the time it managed and
operated TLA No. 43, it has made huge investments on its concession areas.
These include the planting of millions of trees and the scienti c silvicultural
treatment of the forest to make it more productive. Having acquired property
rights over TLA No. 43 areas, [PICOP] need not be required to secure clearance
from the NCIP pursuant to Section 59 of RA 8371. EADSIa
[The DENR Secretary's] claim that [PICOP] failed to settle its outstanding
obligations to the government in the form of unpaid forest charges do not inspire
belief. Under Sec. 3 (3.5) of DENR Memorandum Circular No. 96-04 dated March
14, before an Integrated Annual Operations Plan (IAOP) can be issued, it is a
condition precedent that the licensee has no pending forestry accounts. If it were
true that [PICOP] had unpaid forest charges, why was it issued IAOP for calendar
year 2001-2002 by Secretary Alvarez himself? 8 8
Upon close scrutiny of the records, this Court observes that these ndings of
compliance by PICOP are negated by the very evidence on which they are supposedly
moored.
As clearly shown by the 31 July 2001 Memorandum of Regional Executive
Director Elias D. Seraspi, Jr., DENR Caraga Region, RED Seraspi neither made a
categorical nding of PICOP's satisfactory performance on its TLA No. 43 nor
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favorably recommended approval of PICOP's application for IFMA conversion. Rather,
RED Seraspi recommended the proper evaluation of PICOP's request for the automatic
conversion of TLA No. 43 into an IFMA:
Hence, it is imperative to chart a good forest policy direction for the
management, development and protection of TLA No. 43 after it expires on April
26, 2002 for the purpose of sustainable forest management of the area in support
of national development. With this vision, the proper evaluation to consider the
request for automatic conversion of TLA No. 43 to IFMA pursuant to Section 9,
DENR A.O. No. 99-53, upon its expiration on April 26, 2002 is hereby
recommended. 8 9
Administrative Requirements
There was actually no way by which RED Seraspi could have come up with a
satisfactory performance nding since the very Performance Evaluation Team tasked
to make the evaluation found PICOP to have violated existing DENR rules and
regulations. According to the 11 July 2002 Memorandum Report of the Performance
Evaluation Team, PICOP has not submitted its Five-Year Forest Protection Plan and its
Seven-Year Reforestation Plan. 9 0
Forest charges are, on the other hand, due and payable within 30 days from
removal of the forest products from the cutting area when timber and other forest
products are removed for domestic sales pursuant to Sections 6 and 6.2 of DAO No.
80, series of 1987. Thus:
Section 6. Payment of Forest Charges. — . . . In such a case, the forest
charges shall be due and payable as follows:
6.1 When timber and other forest products are intended for export. — . . . .
6.2 When timber and other forest products are to be removed for domestic
sales. — The forest charges shall be due and payable within thirty (30)
days from removal thereof at the cutting area, or where the forest products
are gathered; Provided, that such date of removal shall in no case be
beyond thirty (30) days when the products are cut, gathered and removed.
The court may not construe a statute that is clear and free from doubt. Time and
again, it has been repeatedly declared by this Court that where the law speaks in clear
and categorical language, there is no room for interpretation. There is only room for
application. 1 0 3 PICOP's intent to put a cloud of ambiguity in Section 59 of Republic Act
No. 8371 by invoking Section 3(a) thereof fails miserably. Section 3(a) of Republic Act
No. 8371 defines ancestral domain as follows:
a) Ancestral domains — Subject to Section 56 hereof, refers to all
areas generally belonging to ICCs/IPs comprising lands, inland waters, coastal
areas, and natural resources therein, held under a claim of ownership,
occupied or possessed by ICCs/IPs, by themselves or through their
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ancestors, communally or individually since time immemorial,
continuously to the present except when interrupted by war, force majeure
or displacement by force, deceit, stealth or as a consequence of government
projects or any other voluntary dealings entered into by government and
private individuals/corporations , and which are necessary to ensure their
economic, social and cultural welfare. It shall include ancestral lands, forests,
pasture, residential, agricultural, and other lands individually owned whether
alienable and disposable or otherwise, hunting grounds, burial grounds, worship
areas, bodies of water, mineral and other natural resources, and lands which may
no longer be exclusively occupied by ICCs/IPs but from which they traditionally
had access to for their subsistence and traditional activities, particularly the home
ranges of ICCs/IPs who are still nomadic and/or shifting cultivators;
These provisions are clear: the prior approval of local government units affected
by the proposed conversion of a TLA into an IFMA is necessary before any project or
program can be implemented by the government authorities that may cause "depletion
of non-renewable resources, loss of crop land, rangeland or forest cover, and extinction
of animal or plant species."
The common evidence of the DENR Secretary and PICOP, namely the 31 July
2001 Memorandum of RED Seraspi, enumerates the local government units and other
groups which had expressed their opposition to PICOP's application for IFMA
conversion:
7. During the conduct of the performance evaluation of TLA No. 43
issues/complaints against PRI were submitted thru Resolutions and letters. It is
important that these are included in this report for assessment of what are their
worth, viz:
xxx xxx xxx
7.3 Resolution Nos. 10, s-2001 and 05, s-2001 (ANNEXES G & H) of the
Bunawan Tribal Council of Elders (BBMTCE) strongly demanding
none renewal of PICOP TLA. They claim to be the rightful owner of
the area it being their alleged ancestral land.
7.4 Resolution No. 4, S-2001 of Sitio Linao, San Jose, Bislig City
(ANNEX I) requesting not to renew TLA 43 over the 900 hectares
occupied by them.
7.5 Resolution No. 22, S-2001 (ANNEX J) of the Sanguniang Bayan,
Lingig, Surigao del Sur not to grant the conversion of TLA 43 citing
the plight of former employees of PRI who were forced to enter and
farm portion of TLA No. 43, after they were laid off.
7.6 SP Resolution No. 2001-113 and CDC Resolution Nos. 09-2001 of
the Sanguniang Panglungsod of Bislig City (ANNEXES K & L)
requesting to exclude the area of TLA No. 43 for watershed
purposes.
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7.7 Resolution No. 2001-164, dated June 01, 2001 (ANNEX M)
Sanguniang Panglungsod of Bislig City opposing the conversion of
TLA 43 to IFMA for the reason that IFMA do not give revenue
benefits to the City. 1 0 6
By giving this clearance for the conversion of PICOP's TLA into an IFMA, the
DENR Secretary cannot, by any stretch of imagination, be claimed to have granted the
conversion itself. The letter is clear that the "conversion" could not be nal since its
conditions and details still have to be discussed as stated in the second paragraph of
said letter; hence, the same letter could not have reduced to a mere formality the
approval of the conversion of PICOP's TLA No. 43 into an IFMA.
Likewise, then DENR Secretary Alvarez's 26 April 2002 letter approving PICOP's
Transition Development and Management Plan (TDMP) cannot be considered as an
approval of PICOP's application for IFMA conversion. Again, the aforesaid letter is
quoted in full:
April 24, 2002
(sgd)
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HEHERSON T. ALVAREZ
Secretary
Cc: Mr. Teodoro G. Bernardino
President
The aforesaid letter speaks for itself. PICOP's application for IFMA conversion is
still pending approval . Indeed, there could have been no approval of PICOP's
application for IFMA conversion because DAO No. 99-53 (which governs application for
IFMA conversion) requires full and complete compliance with the requirements for
conversion before it may be approved. As stated in the letter itself of then DENR
Secretary Alvarez, PICOP has yet to "submit/comply with all the necessary
requisites for final conversion of TLA No. 43 into IFMA ."
Even assuming, however, that the IFMA has already been converted, this is all
purely academic because of the above-discussed settled jurisprudence that logging
permits are not contracts within the Non-Impairment Clause and thus, can be amended,
modi ed, replaced or rescinded when the national interest so requires. If the DENR
Secretary, therefore, nds that the IFMA would be in violation of statutes, rules and
regulations, particularly those protecting the rights of the local governments and the
indigenous peoples within the IFMA area, then it behooves the DENR Secretary to
revoke such IFMA. These same statutes, rules and regulations are the very same
requirements mentioned above for the conversion of the TLA No. 43 into an IFMA.
Whether or not it is proper to
determine the constitutionality of
Proclamation No. 297 in these
consolidated petitions
Another reason why the DENR Secretary wishes to further withhold the
conversion of PICOP's TLA No. 43 into an IFMA is the 25 November 2002 Proclamation
No. 297 excluding an area of 8,100 hectares, more or less, from the coverage of TLA
No. 43, as amended, and which declared the same as a mineral reservation and as an
environmentally critical area. The DENR Secretary claims that said Presidential
Proclamation is rendered nugatory by the Court of Appeals' disposition that the DENR
should honor and respect the area allotted to PICOP under TLA No. 43. 1 1 2
PICOP claims that Proclamation No. 297 is a new matter which the DENR
Secretary cannot raise before this Court without offending the basic rules of fair play,
justice and due process. 1 1 3
The DENR Secretary counters that it did not take up the issue of Proclamation
No. 297 before the trial court precisely because said proclamation was issued more
than one month after the trial court rendered its 11 October 2002 Decision. The DENR
Secretary claims that PICOP cannot claim a violation of its right to due process
because it raised the issue before the Court of Appeals in its Memorandum.
While not giving in to the DENR Secretary's argument, PICOP claims that
Proclamation No. 297 is violative of the Constitution and an encroachment on the
legislative powers of Congress. 1 1 4
We agree with PICOP that this constitutional issue cannot be decided upon in
this case. This Court will not touch the issue of unconstitutionality unless it is the very
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lis mota. It is a well-established rule that a court should not pass upon a constitutional
question and decide a law to be unconstitutional or invalid, unless such question is
raised by the parties and that when it is raised, if the record also presents some other
ground upon which the court may raise its judgment, that course will be adopted and
the constitutional question will be left for consideration until such question will be
unavoidable. 1 1 5
The constitutional question presented by PICOP is not the very lis mota in these
consolidated cases, as the preceding discussions very well give us adequate grounds
to grant the Petition in G.R. No. 162243, deny the Petition in G.R. No. 164516, and
dismiss the Petition in G.R. No. 171875. Moreover, PICOP has led a separate petition
for the declaration of nullity of Proclamation No. 297, wherein the issue of the
constitutionality of Proclamation No. 297 is properly ventilated.
Consequently, all actions and reliefs sought by either PICOP or the DENR
Secretary which has Proclamation No. 297 as its ground or subject should be ventilated
either in the pending petition for the declaration of its nullity, or in another proper suit
instituted for that matter.
EPILOGUE AND DISPOSITION
In sum, the DENR Secretary has adequately proven that PICOP has, at this time,
failed to comply with the administrative and statutory requirements for the conversion
of TLA No. 43 into an IFMA. The Petition in G.R. No. 162243 should therefore be
granted.
On the other hand, as PICOP is not yet entitled to such conversion, then Secretary
Alvarez had been correct in withholding the same and thus cannot be held liable for
damages therefor. Thus, the Petition in G.R. No. 164516 should be dismissed.
Finally, the DENR Secretary's Petition in G.R. No. 171875, assailing the lifting by
the Court of Appeals of the Preliminary Injunction in its favor, is now mooted.
PICOP's noncompliance with the requirements for the conversion of their TLA is
so glaring, that we almost see a reluctance to uphold the law in light of PICOP's
sizeable investments in its business, a fact repeatedly stressed by PICOP in its
pleadings. In applying the judicial policy of nurturing prosperity, consideration should
also be given to the long-term effects of the judicial evaluations involved, particularly to
our nation's greatest wealth, our vast natural resources.
Our country has been blessed with rich, lush and verdant rain forests in which
varied, rare and unique species of ora and fauna may be found. 1 1 6 The legislative
policy has been to preserve and nourish these natural resources as they are not only for
our bene t but more so for the countless future generations to which we are likewise
responsible. It has also been legislative policy to let the citizens of this country reap
their bene ts, foremost the citizens in close proximity to such resources, through the
local governments and the NCIP.
In working for the legislative policy of environmental preservation, the
requirements of a ve-year forest protection plan and seven-year reforestation plan had
been laid down, together with the levy of forest charges for the regulation of forestry
activities. In pursuing, on the other hand, the bene t distribution policy, the Local
Government Code requires prior Sanggunian approval to ensure that local communities
partake in the fruits of their own backyard, while R.A. No. 8371 provides for the rights of
the indigenous peoples, who have been living in, managing, and nourishing these forests
since time immemorial.
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PICOP has been fortunate to have been awarded an enormous concession area
and thus, a huge chunk of the bene ts of this country's natural resources. Attached to
this fortune is the responsibility to comply with the laws and regulations implementing
the stated legislative policies of environmental preservation and bene t distribution.
These laws and regulations should not be ignored, and the courts should not condone
such blatant disregard by those who believe they are above the law because of their
sizable investments and signi cant number of workers employed. PICOP has only itself
to blame for the withholding of the conversion of its TLA. But while this disposition
confers another chance to comply with the foregoing requirements, the DENR Secretary
can rightfully grow weary if the persistence on noncompliance will continue. The judicial
policy of nurturing prosperity would be better served by granting such concessions to
someone who will abide by the law.
WHEREFORE, the Petition in G.R. No. 162243 is GRANTED. The Decision of the
Court of Appeals insofar as it a rmed the RTC Decision granting the Petition for
Mandamus led by Paper Industries Corporation of the Philippines (PICOP) is hereby
REVERSED and SET ASIDE. The Petition in G.R. No. 164516 seeking the reversal of the
same Decision insofar as it nulli ed the award of damages in favor of PICOP is DENIED
for lack of merit. The Petition in G.R. No. 171875, assailing the lifting of the Preliminary
Injunction in favor of the Secretary of Environment and Natural Resources is DISMISSED
on the ground of mootness.
SO ORDERED.
Panganiba, C.J., Ynares-Santiago, Austria-Martinez and Callejo, Sr., JJ., concur.
Footnotes
1. Penned by Judge Jose G. Pineda, Quezon City RTC, Branch 220.
2. Penned by Associate Justice Ruben T. Reyes with Associate Justices Edgardo P. Cruz
and Noel G. Tijam concurring; rollo of G.R. No. 162243, pp. 229-258.
3. Penned by Associate Justice Juan Q. Enriquez, Jr. with Associate Justices Hakim S.
Abdulwahid and Vicente Q. Roxas concurring; rollo of G.R. No. 171875, pp. 67-78.
10. Records, Vol. 1, pp. 84-85; Folder of Exhibits, Exhibits 7-D and 7-E, pp. 471 and 472;
Records, Vol. 3.
Anent the Motion for Inhibition, while the Court refutes the grounds relied upon by the
petitioner in support of said move, for the peace of mind of the petitioner, the Court
deems it proper to inhibit itself from taking cognizance of this case.
For reason of propriety, the merits or demerits of petitioner's "Motion for
Reconsideration" will not be ruled upon and shall be left to be dealt with by the next
Court.
Accordingly, this Court INHIBITS, and let the expediente of this case be transmitted to
the Executive Judge, through the Office of the Clerk of Court, RTC, QC, for re-raffle.
45. Records, Vol. 4, pp. 1349-1575.
b) PICOP tenure over the said area of TLA No. 43 and exclusive right to cut,
collect and remove sawtimber and pulpwood for the period ending on April 26, 1977; and
said period renewable for [an]other 25 years subject to compliance with constitutional
and statutory requirements as well as with existing policy on timber concessions; and
c) The peaceful and adequate enjoyment by PICOP of the area as described and
specified in the aforesaid amended Timber License Agreement No. 43. (Records, Vol. 4,
pp. 1374-1375.)
71. The Court of Appeals cites Aquino-Sarmiento v. Morato, G.R. No. 92541, 13 November
1991, 203 SCRA 515, 520-521; Pagara v. Court of Appeals, 325 Phil. 66, 81 (1996).
102. Oposa v. Factoran, Jr., supra note 81 at 812; Tan v. Director of Forestry, supra note 83
at 325.
103. Cebu Portland Cement Co. v. Municipality of Naga, 133 Phil. 695, 699 (1968).
104. Republic Act No. 8371, Section 3(c):
105. G.R. No. 135385, 6 December 2000, 347 SCRA 129, 238, Separate Opinion of Justice
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Reynato Puno.
106. Folder of Exhibits, Exhibit O-1, Vol. 2, p. 176; Exhibit 7-g, Vol. 3, p. 475.